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Maryland Job Recovery Has Far To Go

maryland-job-recoveryDespite Upbeat Report By O’Malley, Maryland job recovery has far to go

Jobs ‘recover,’ but still far to go

With count at pre-recession level, ‘it feels incomplete’

By Lizzy McLellan, Daily Record

Though Maryland’s jobs count has made a full recovery — returning to its pre-recession level — a still-high unemployment rate, a growing workforce, uncertainty in the federal government and ongoing transformation within the state economy indicate room for progress remains.

“It feels incomplete,” said Daraius Irani, executive director of the Regional Economic Studies Institute at Towson University.

With the potential for a government shutdown at the end of the month, Irani said, October’s employment report might show declines in Maryland, where 144,800 people held jobs in the federal government in August and where many private-sector jobs are with government contractors. Already, Maryland jobs in the federal government have dropped 1.2 percent from August 2012 to August 2013.

Potential remains for continued growth because the vast majority of jobs in Maryland’s private sector are not in government-contracted businesses, said Jim Palma, a senior manager in the research and information unit of the Maryland Department of Business and Economic Development.

“It does seem like our trend is such that we will probably stay over the 100 percent mark going forward,” Palma said.

And it needs to — while the number of jobs is back up to about 2.6 million, state unemployment remains at 7 percent. It has decreased overall since 2010, but is nowhere near pre-recession levels of 3 percent.

“The number of people who need jobs is larger than it was at the peak of 2007,” said Palma. “That’s why I say we need to keep going.”

Maryland reached its 100 percent recovery landmark in August with the addition of 9,700 jobs. During the recession, the state lost 146,100 jobs, said Maryland Labor Secretary Leonard Howie. About 90 percent of the recovered jobs are in the private sector.

But the August gain simply made up for 9,700 jobs lost in July, according to a revised count also released Friday.

Irani attributed the new August jobs to back-to-school hiring.

“Obviously, we’ve had months where we’ve gained, months where we’ve lost, but when you add them all up, we’ve recovered what we lost,” said Howie.

Overall, Maryland is ahead of the curve, as the United States job recovery remains at 78 percent, Palma said.

In January, the Maryland jobs report showed that 86 percent of jobs were recovered, and that jumped to 94 percent in February. Since then, that percentage crawled slowly toward 100, reaching 99 percent in June.

“Those clowns in Congress who have been for the last seven years … have been unable to compromise in getting a budget, the uncertainty they’re creating is contributing to that lackluster recovery,” said Irani.

Palma agreed that government events have slowed recovery, but said the true effects of the sequester on employment are yet to be seen.

“Certainly, the sequester has started to shift government spending,” said Palma. “There’s so many unknowns in the short term with what will happen in Washington.”

While federal government and manufacturing jobs suffered in the past year, health care and professional services showed large increases in employment.

This is a good indicator, said Irani, because positions in these sectors tend to be full-time, more so than those in leisure, hospitality and food, which are often part-time. Those sectors showed a notable percentage increase in jobs as well over the past year, but the number of jobs created was smaller than in health care and professional services.

The trends are not only related to the recession, but also stem from a changing economy that has caused some challenges, said Irani. For instance, the noticeable decrease of employment in manufacturing of durable goods is likely due to automation, and decreases in the information sector may be related to a changing media market.

“There’s been some transformative things going on,” Irani said. “Those trends were moving already through the economy prior to the recession.”

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